Judge rules City of Toronto negligent towards Pardale tenants

The City of Toronto was negligent towards Parkdale rooming-house tenants by failing to notify them of rent reductions after their landlords’ property taxes were slashed, an Ontario Superior Court judge has ruled.
Superior Court Justice Paul Perell found in his 17- page class action decision that The City of Toronto was negligent by failing to notify Parkdale rooming-house tenants of the rent reduction, causing the tenants to subsequently overpay their rent.

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The City of Toronto was negligent towards Parkdale rooming-house tenants by failing to notify them of rent reductions after their landlords’ property taxes were slashed, an Ontario Superior Court judge has ruled.

“It was a breach of the standard of care for the city to not give any notice at all,” Justice Paul Perell wrote in a 17-page ruling in the class action case. “I affirmatively conclude that the city was negligent.”

Unless the city’s legal department appeals, the decision brings to an end a seven-year legal saga that began after the city, between 2004 and 2008, reduced the property taxes on 33 Parkdale rooming houses between 25 to 70 per cent after the properties were reclassified.

The city was required to notify both tenants and landlords of the latter’s obligation to pass a portion of the savings on to the tenants. It didn’t, however, and an estimated 200 to 500 tenants, unaware of the reduction, overpaid their rent.

“It’s inexplicable in this case, of all cases, the city simply didn’t send these notices, and effectively let these people down,” said Brendan van Niejenhuis, the lawyer representing plaintiff Terence Williams.

“The energy that’s been put into resisting this case has been, I’ll call it surprising, but it’s a clear injustice as far as I can see involving vulnerable people.”

The average claim owing to individual class members is likely about $3,000 “based on educated assumptions about rents in rooming houses at the time,” he said.

The city’s combined liability could be as much as $500,000, he said. The city is currently reviewing the Jan. 4 decision, spokeswoman Wynna Brown said.

Williams, 65, a community support worker in Parkdale, said he expects he might collect up to $500.

“The tenants . . . were low-income people or on social assistance, (who) could use the money for their personal needs,” he said Wednesday.

At one point during the legal odyssey Perell, in a 2011 ruling, wrote that he was reminded of the Greek myth of Tantalus, who was punished for his misdeeds by eternal confinement below a fruit tree beside a pool of fresh water.

“As punishment, if Tantalus reached for fruit to eat, the tree branches would raise beyond his grasp, and if he stooped for water to drink, the water would recede. Mr. Williams, who does not deserve any punishment, has been tantalized by the defendant, City of Toronto.”

He also criticized the city for advancing a “cynical” legal argument and giving Williams and the Parkdale Residents Association the “runaround.”

Van Niejenhuis, a partner with the prestigious Toronto litigation firm Stockwoods, got involved in the case after his friend, Warren Sheffer, a lawyer in Parkdale, told him how the tenants had been stiffed.

Councillor Gord Perks, who represents Ward 14 which includes the Parkdale neighbourhood, applauded the judge’s decision.

“We’re talking about amounts of money that would have made a difference to people who were living in some of the lowest-rent units anywhere in Toronto,” Perks said Wednesday.

“These are people often on fixed income or very little income at all. A few dollars . . . would have mattered to people at that time.”

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